Monthly Archives: February 2015

The Weimar experience in the 1930s illustrates the extent to which liberal-democratic constitutional systems can be undone as a result of severe economic collapse that destroys people’s livelihoods. One question for anyone interested in constitutionalism is whether any constitutional system can be designed which can make a society immune (or at least less susceptible) to extreme political shifts, either to the left or right. Equally, can we regard a constitutional provision such as balanced budget amendment as a reasonable attempt to make a country live within its means, or is it, in fact, a policy choice which politicians in the here and now have no right to impose on future generations?

Weimar is burned into the German psyche for very obvious reasons, but have the wrong lessons been learned? For Germany today, the dangers of getting into debt illustrated by the collapse of the Weimar Republic and the rise of the National Socialists was one reason for adding a balanced budget amendment to the Basic Law in 2009, which will become operative in 2016. The paradox, though, is that the anti-debt austerity medicine that Germany feels has worked for it, is causing severe socio-economic damage and political instability in southern European countries. When countries are being forced by other states to endure mass youth unemployment of around 50%, it is unsurprising that people will embrace more radical political options at home and see no value in an ever closer union within Europe.

What should a constitution do in times of extreme stress, and just as importantly, what should it not do? There ought to be enough flexibility in a system for governments to borrow money during a downturn to prevent it becoming a depression. Therefore, should a constitution which is intended to endure for generations to come bind those future generations and prevent them dealing adequately with the economic crises which will inevitably occur?

The concern is that the ‘fiscal constitution’ which Germany effectively imposed on southern Europe in 2011 in return for bailouts, and which it imposed on itself through the balanced budget amendment to the Basic Law, are causing huge deflation across Europe, and are preventing the countries in southern Europe from growing their way out of their debt predicament. The principle casualties so far have been centrist parties across the EU and particularly in southern Europe which have supported the fiscal straight-jacket approach favoured by Berlin.

Professor Keith Whittington of Princeton noted that “constitutions cannot survive if they are too politically costly to maintain and they cannot survive if they are too distant from normal political concerns.” (2007, p.26) For the countries and peoples of the eurozone, the constitutions which have to be maintained are not simply their own domestic ones, but the commitments arising from EU treaties and EU law.

A crunch is undoubtedly coming with respect to Greece and possibly some of the other indebted countries of Southern Europe which may well determine whether the benefits of remaining within the eurozone are worth the pain and political instability of maintaining Europe’s political and fiscal constitution. It may well be the case that Germany will blink first and do a deal to keep Greece in the eurozone to prevent the unpredictable consequences of a Greek default and exit which, as Barry Eichengreen notes, “would be Lehman Brothers squared” in terms of its likely effects on European and global financial stability. At that point money will likely flood out of all the banks of southern Europe, probably to the perceived safety of German and even UK banks. We’d then be back to the worst moments of the 2008 financial crisis.

This is where it is hard to see the logic of fiscal straight-jackets, whether they are imposed on southern Europe by Germany in exchange for bailouts, or by Germany upon itself through a balanced budget amendment. Germany is understandably wary of the dangers of debt because of its own history. However, Berlin’s ‘fiscal constitution’ is driving the PIGS states towards the exit and the eurozone towards a brick wall which may endanger the entire European project. Then, the political and economic cost of maintaining even the most well designed constitutions may just become too high.

David Miles is a Carnegie Scholar researching Anglo-American and German constitutionalism and is an Associate Fellow at the Centre for Global Constitutionalism. He is also Managing Editor of Global Politics Magazine and is a contributor for the Scotsman, the Daily Beast and Huffington Post.

References:

Whittington, K, The Political Foundations of Judicial Supremacy, Princeton: Princeton University Press, 2007.

The Draft Scotland Bill would insert into the Scotland Act 1998 a new section 1(1A) providing that:

A Scottish Parliament is recognised as a permanent part of the United Kingdom’s constitutional arrangements.

Elliott argues that it is unclear whether “any provision purporting to make the Scottish Parliament permanent would be worth the paper upon which it was printed” due to the doctrine of Parliamentary sovereignty, the absoluteness of which he sees as having been confirmed by LJ Laws in Thoburn v Sunderland City Council [2002] EWHC 195 (Admin), [2003] QB 151: “Being sovereign, [the UK Parliament] cannot abandon its sovereignty.” Elliott believes that given Parliamentary sovereignty, the provision would “lack any legal effect whatever” and that “its consequences are likely to be entirely symbolic.”

Disagreeing somewhat with Elliott, Kenneth Campbell QC does not believe that one can dismiss the legal effects of the proposed legislation so easily, given recent UK Supreme Court rulings. On one important level, this disagreement hinges on the rule of recognition governing how legal rules are recognised within a state. Campbell is right to highlight that in the UK, our rule of recognition is that “whatever the Queen-in-Parliament enacts is law.” It follows, says Campbell, that if this is correct, then the proposed changes should be expected to have legal effects. Here, Campbell suggests that rulings of the UK Supreme Court since devolution may now be pointing towards a tentative recognition that Parliamentary sovereignty may be becoming more limited in a domestic context, quite apart from the already understood and accepted limits imposed by the effects of EU law and the Human Rights Act 1998.

Campbell writes:

“Judicial recognition of constitutional statutes since Thoburn v Sunderland City Council[2002] EWHC 195(admin) [2003] QB 151 has been cautious, but has been affirmed by the Supreme Court, and specifically in the context of devolution: BH v Lord Advocate [2012] UKSC 24; 2012 SC(UKSC) 308, per Lord Hope para 30. Likewise, again in devolution case-law before the Supreme Court, Lord Hope expressly left open the question of whether the supremacy of the UK Parliament is absolute or may be subject to limitation in exceptional circumstances:AXA General Insurance v Lord Advocate [2011] UKSC 46; 2012 SC(UKSC) 122, paras 50 & 51.”

Concluding, Campbell argues that:

“Taking the Supreme Court case-law together with the ‘Scotland clauses’, I suggest that a definite and entirely domestic boundary of Parliamentary supremacy is emerging. That is the meaning and intent of these clauses of the Scotland Bill.”

The interesting aspect of the divergence of views, as I see it, is between Elliott’s theoretical distinction between political (or symbolic) effects and legal effects on the one hand, and on the other, Campbell’s belief as a practising advocate and barrister that what constitutes legal effects must also include (a) legislative intent, (b) how the highest UK court now interprets that intent, and (c) the legitimacy that comes from political recognition of devolution.

“Legal authority […] is empty without general acceptance in a society of the decisions taken by those in authority. Without the backing of political power this cannot practically be achieved.” [1]

Overall, it seems to me that Neil MacCormick’s view on the relationship between legal authority and political authority supports Campbell’s belief that we cannot simply judge the proposed Scotland Bill according to either positive law, or on pre-devolution and Diceyan understandings of Parliamentary sovereignty. We must also recognise that as the constitutional ground continues to move below our feet following the independence referendum, how we judge the ‘legal effects’ may depend much more on what is seen as politically legitimate than we have perhaps been used to before in the UK.

David Miles is a Carnegie Scholar researching Anglo-American and German constitutionalism and is an Associate Fellow at the Centre for Global Constitutionalism. He is also Managing Editor of Global Politics Magazine and is a contributor for the Scotsman, the Daily Beast and Huffington Post.